WASHINGTON — Any effort to improve the way financial services are regulated should include giving credit unions a risk-based capital system because it would benefit consumers, CUNA President Dan Mica wrote chairman and ranking Republican of the House Financial Services Committee.
"As a result of the rigid statutory capital requirement, the general risk-averse nature of credit unions and their inability to access secondary capital, the average capital ratio of credit unions is 11%, 4 % higher than the statutory requirement to be 'well capitalized,'" Mica wrote.
The money represented by the difference could be put to use to benefit the consumers and the economy, he added.
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Credit unions have long pushed for this policy change. And the more comprehensive regulatory relief measure the Credit Union Regulatory Improvements Act (H.R. 1537) would lower the leverage requirement for credit unions while imposing a risk-based capital requirement. That provision was not included in the Credit Union Bank and Thrift Regulatory Relief Act (H.R. 6312), which passed the House last month and is awaiting Senate action.
Mica wrote the letter as the House Financial Services Committee began a series of hearings on ways to change how the government regulates financial institutions.
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